Committee hears testimony on bill to curb medical debt collections and delay actions during insurance appeals

Rep. Ed Staffman, sponsor of House Bill 273, told the House Health and Human Services Committee on Feb. 3 that the bill — styled the Montana Medical Debt Protection Act — is intended to protect Montanans from ‘‘extraordinary collection actions’’ such as foreclosures, forced garnishments and credit reporting while giving patients more time to pursue insurance appeals. The hearing, held in the committee room, drew health advocates, tribal representatives and legal-aid attorneys to testify in favor and a trade group to oppose.

The bill would prohibit specified collection measures for medically necessary care, require creditors to provide notice before certain actions, and — as amended during drafting — shorten a waiting period from 180 days to 120 days. It would also require that, if property is seized to satisfy a medical debt, a person be left with at least $3,000 in exempt funds. Staffman said those provisions were modeled on neighboring states’ laws and included an exception when a patient has signed an Advanced Beneficiary Notice (ABN) at a hospital.

"This act . . . will protect people from the extreme debt collection practices, like losing their homes or having their wages taken," Staffman said as he laid out the bill’s key sections, including…